Age 18 and beyond: At this point, your kids are preparing to enter into the real world. Hopefully, they have a good grasp on the value of money and the know-how to responsibly manage a savings account. Now’s the time to talk to them about budgeting, education costs, student debt and more. Want to know how? Read the full article here.
How to get kids into the habit of saving
Knowing the value of a dollar (and how much ramen it can buy) going into university helps set kids up for a better relationship with money. Getting kids started with their own real bank account helps foster that knowledge. Look for a kids’ bank account with low or no fees, since the last thing you want is for fees to eat up their smaller contributions. If you can find an account that helps them earn interest, even better. Read more about what to consider in a kids’ bank account here.
What is an RESP?
A Registered Education Savings Plan is an investment account geared towards saving for a child’s education. An RESP allows investments inside the account to grow tax-free, meaning that no money is owed to the government based on capital gains, interest nor dividend payments. A major benefit of this account: The government pays you to save by kicking in a grant of up to $7,200 over the life of the plan (and potentially more if your family has a low income). To learn more about RESPs, read the full article.
How to withdraw from an RESP
When it’s time to cover the costs of post-secondary tuition, housing and books, you’ll want to understand the steps involved in withdrawing from your family RESP. Regardless of who made the contributions—a parent, grandparent, other family member or family friend—the withdrawals are usually taxed on the student’s income. Typically, students’ income is usually much lower than the contributor’s, so the tax amount owed is generally very low or even $0. That’s the top-level strategy, but there are other tips to help you maximize your RESP savings and returns. For a financial planner’s tips on how to withdraw from this type of account, you can also read this article.
How to make RESP withdrawals for kids with different educational paths
Parents know no two kids are the same. One kid may be headed off to culinary school, while another one pursues academia and the other goes to an arts college. Different educational paths come with different costs and different challenges. If you’re looking for advice on how to fund different types of schooling, read this article.
How to help kids save money on student housing costs
The cost of housing can be a big one (it can easily add up to a shocking $50,000 over the course of a four-year degree). However, there is a way to turn this financial burden into an opportunity, if you are in the fortunate position to have the financial means to do so: Buying a property in the vicinity of your kid’s chosen post-secondary institution, and becoming their landlord, can help you both save money (especially if your kid rents out rooms to their classmates). Read more about it in the full article.
Financial aid guide for college and university in Canada
There are many paths to funding your education aside, from a student’s own savings and their parents’ contributions. Get a list of the bursaries, scholarships, grants and provincial loans that may be available to you right here.
How to apply for OSAP
If you need to fund your post-secondary education but don’t have much in the way of savings, you can use student loans to fully or partially cover costs, depending on your approved amount. The Ontario Student Assistance Program (OSAP) works in conjunction with the federal loans and grants programs to make sure you can pursue the education you want, with a relatively low-interest loan after graduation day. For more details on how to apply for OSAP, check out the full article.